The Securities and Exchange Commission has received more than 500,000 comments urging the agency to require publicly traded companies to disclose their donations to trade associations and other nonprofits, which currently do not have to identify who’s giving them the millions of dollars they spent on political advertisements.
“This is simply to inform sharerholders of what corporations are doing,” Rep. Michael Capuano, a Massachusetts Democrat, told reporters on a conference call with advocates of an SEC disclosure rule.
Bloomberg News today looked at efforts to force the Internal Revenue Service to crack down on political spending by nonprofits, who do not have to disclose their donors.
Disclosure rules could cause companies to think twice about getting involved in campaigns, since they will no longer be anonymous. Target Corp. faced a boycott by gay rights groups in 2010 after the company donated $150,000 to a business group supporting Minnesota Republican gubernatorial candidate Tom Emmer, who opposed same-sex marriage.
“We’ll wind up with better corporate governance,” said Trevor Potter, a former Federal Election Commission chairman who is president of the Campaign Legal Center, a Washington-based advocacy group that favors greater disclosure. “Corporations will have a process in place, as they should, to determine when to spend. It will not be a single corporate officer responding to a phone call from a friend but rather will reflect a measured, thoughtful spending of shareholder money.”
No word on when the SEC will take up the proposed rule.